Obama Called Out Hedge Fund Managers And Private Equity Firms Last Night, And They Didn't Like Ithttp://www.businessinsider.com/obama-to-tackle-carried-interest-2013-2/comments
en-usWed, 31 Dec 1969 19:00:00 -0500Tue, 03 Mar 2015 16:20:20 -0500Linette Lopezhttp://www.businessinsider.com/c/5110c29d6bb3f7a30d000013NoSingleOneTue, 05 Feb 2013 03:28:13 -0500http://www.businessinsider.com/c/5110c29d6bb3f7a30d000013
Have you ever heard of TALF? Getting 90% leverage subsidized by Uncle Sugar helped make hedgies rich on the backs of taxpayers. <a href="http://online.wsj.com/article/SB10001424052748703865004575649233598560948.html" target="_blank" rel="nofollow" >http://online.wsj.com/article/SB10001424052748703865004575649233598560948.html</a>
Do you not understand that the AIG bailout was not stealth hedge fund bailout? <a href="http://www.businessinsider.com/aig-bailout-enriching-hedge-funds-2009-3" target="_blank" rel="nofollow" >http://www.businessinsider.com/aig-bailout-enriching-hedge-funds-2009-3</a>
Did you know that the Fed lowered the federal funds rate and implied it would do whatever it took to save LTCM, basically turning it into a GSE like Fannie and Freddie? Only because the banks were offered a 90% stake to take over LTCM was it spared the same fate as Fannie and Freddie. An implicit offer of a gov't bailout is the same as being bailed out. <a href="http://www.independent.co.uk/news/business/bear-stearns-500m-call-triggered-ltcm-crisis-1200636.html" target="_blank" rel="nofollow" >http://www.independent.co.uk/news/business/bear-stearns-500m-call-triggered-ltcm-crisis-1200636.html</a>
Are you in that much denial that you can't see they benefited from government intervention?
You can't possibly be that naive or stupid to think that just because they didn't get the cash directly they weren't bailed out, are you??? Nah, of course you are, because the truth would be too painful...but go ahead and believe the fairy tale, if for no other reason that a massive loss of confidence without the bailout would have killed them anyway.http://www.businessinsider.com/c/5110279cecad04ae0700000cA HMon, 04 Feb 2013 16:26:52 -0500http://www.businessinsider.com/c/5110279cecad04ae0700000c
The capital gains rate makes sense when there is a possibility of loss. The beneficiaries of carried interest cannot lose. They might not win, but they cannot get a negative. So in my opinion the capital gains rate should not apply to carried interest. (And I am virtually in the industry and an economic conservative/ libertarian!) It sucks that their rate would go up 3x (15% to 43.4%), but just because we have been killing thousands of people with drones in Asia doesn't mean we shouldn't stop completely!
I do think the flip side should be tax deductible. The New Years compromise on taxes introduced a phase out of deductions, with the effect that, in the most extreme case, only 20% of the investment fees paid are deductible. So you can have a case where you pay someone $99 to make you $100 (marginally), which is a perfectly good (if unusual) economic transaction, but the effective tax rate on your $1 net will be 173.6% [=($100- ($99-$3))*.434/$1]. When the deduction or loss is inseparably linked to the income or gain being taxed, the deduction should not be subject to floors or phase outs.
So I propose a compromise: investment fees become unrestricted deductions (maybe the way commissions work -- deductions from basis regardless), increasing demand for hedge fund and private equity services as compared to present law, but carried interest becomes taxed as income.http://www.businessinsider.com/c/51100f70eab8ea9353000004jinqian0529Mon, 04 Feb 2013 14:43:44 -0500http://www.businessinsider.com/c/51100f70eab8ea9353000004
I am sure they do not like it lolhttp://www.businessinsider.com/c/510ff6056bb3f73317000005NickMon, 04 Feb 2013 12:55:17 -0500http://www.businessinsider.com/c/510ff6056bb3f73317000005
How exactly do you subsidize their losses? No hedge fund has ever been labeled too big to fail. Even LTCM wasn't bailed out, it was orderly put to rest so as not to make too big a mess. No hedge fund has taken tax payer money, you just demonstrated your own ignorance.
Funds live and die by their ability to demonstrate returns.http://www.businessinsider.com/c/510fdfc06bb3f73b6b00000eNoSingleOneMon, 04 Feb 2013 11:20:16 -0500http://www.businessinsider.com/c/510fdfc06bb3f73b6b00000e
I have to agree with Obama on this...it's a matter of fairness. This kind of privileged income shelter does not preserve jobs, especially when the shortfall is made up by earned income workers.
The way hedgies and PE's operate, it's really a matter of giving kickbacks to a casino...they get a tax cut on their winnings, and we get to subsidize their losses. I'm tired of it.http://www.businessinsider.com/c/510fdf18ecad04987d000002romney 2012Mon, 04 Feb 2013 11:17:28 -0500http://www.businessinsider.com/c/510fdf18ecad04987d000002
Do you need any more evidence that the left wants to make America unsafe and push the economy into a double dip recession?
The left is the party of recession and crisis. since Obama's first inauguration it;s been a never ending crisis.
Does this come as a surprise? The economy entered a recession on the Clinton surplus, too.
it's a bird!, it's a plane! no it's Robert Reich flapping his arms trying to turn on a light switch
<a href="http://tinyurl.com/esdd79ssdqe" target="_blank" rel="nofollow" >http://tinyurl.com/esdd79ssdqe</a>
shttp://www.businessinsider.com/c/510fddb26bb3f7106500001bMike MatheaMon, 04 Feb 2013 11:11:30 -0500http://www.businessinsider.com/c/510fddb26bb3f7106500001b
Why am I not surprised that the President waited until after he recieved all the campaign mopney from Hedge Fund mamaners to make this statement.http://www.businessinsider.com/c/510fdb43eab8eaee52000007FacepalmMon, 04 Feb 2013 11:01:07 -0500http://www.businessinsider.com/c/510fdb43eab8eaee52000007
No, the last refuge of scoundrels is any one of the lonbying firms and think tanks inside the beltway.http://www.businessinsider.com/c/510fda87ecad044d7200000cFacepalmMon, 04 Feb 2013 10:57:59 -0500http://www.businessinsider.com/c/510fda87ecad044d7200000c
Duh. Fundies are relo'g to FL and much of the fed hike will be offset by the cut in state taxes. Two words: "tax incidence"http://www.businessinsider.com/c/510fd9a8ecad04f670000009balijMon, 04 Feb 2013 10:54:16 -0500http://www.businessinsider.com/c/510fd9a8ecad04f670000009
I am hoping there wasn't a fight between managers ..... Remember Bill Ackman vs Carl Icahn
<a href="http://wallstnews.blogspot.com/" target="_blank" rel="nofollow" >http://wallstnews.blogspot.com/</a>http://www.businessinsider.com/c/510fd8e26bb3f7a45d00000dBossuMon, 04 Feb 2013 10:50:58 -0500http://www.businessinsider.com/c/510fd8e26bb3f7a45d00000d
"75%" even a liberal would revolt at the thought of paying that much.
I agree they should pay more, but in the range of 35% to 40% .http://www.businessinsider.com/c/510fd865ecad049b6d000012Gidion GonoMon, 04 Feb 2013 10:48:53 -0500http://www.businessinsider.com/c/510fd865ecad049b6d000012
Scary video. Proves that Obama is owned by the banking industry.http://www.businessinsider.com/c/510fd7ab6bb3f78f5b000004Tom FioreMon, 04 Feb 2013 10:45:47 -0500http://www.businessinsider.com/c/510fd7ab6bb3f78f5b000004
Yes, but isn't the private equity business more about making sure that every company has as little equity and as much debt as the bankers will allow? The PE people say that they bring in better management and rebuild companies, but the only thing that all PE involved companies all have in common is more debt and less cash when the wizards of Capitalism are done with them.http://www.businessinsider.com/c/510fd21169bedd6013000013robertso2020Mon, 04 Feb 2013 10:21:53 -0500http://www.businessinsider.com/c/510fd21169bedd6013000013
Carried interest is more of a private equity/real estate development/VC concern. Most Hedge fund's blended cap gains is closer to s/t gains which is a GP's ordinary income tax rate so it wouldn't be as big of a hit. A bigger issue for HF managers would be the tax treatment of deferred comp in an offshore vehicle---although that may have been changed a few years ago. I'm not sure.http://www.businessinsider.com/c/510fd0c6eab8eaf238000003mlambMon, 04 Feb 2013 10:16:22 -0500http://www.businessinsider.com/c/510fd0c6eab8eaf238000003
Carried interest as a tax loophole should be abolished. I say this as someone who works in private equity.
That said, I agree with your other point re: 2/20. People willingly invest in these funds because they offer outsized returns (you can thank the Fed for 0% interest on your savings account btw). It's not society's decision to make.http://www.businessinsider.com/c/510fccc1ecad04c959000001Romney Told Him To Crack Down At Private White House MeetingMon, 04 Feb 2013 09:59:13 -0500http://www.businessinsider.com/c/510fccc1ecad04c959000001
Romney came clean and admitted that (just like Warren Buffet) the super rich already lead opulent lifestyles beyond their wildest dreams and need to be kind and compassionate.
Maybe he remembered Jesus stating the last here on Earth would be first in Heaven.
Either that or fitting an elephant through a needle.
Smart, yes very smart just like Nicodemus.http://www.businessinsider.com/c/510fcc5169bedd550300000cBlackrock CEO Larry the FinkMon, 04 Feb 2013 09:57:21 -0500http://www.businessinsider.com/c/510fcc5169bedd550300000c
Worried about what Obama had to say? Hell no. In fact, we hedge funders (aka Obama election funders), wrote his script. Obama knows that it is his job to make sure that the super rich get to keep ALL of their toys, no matter what.http://www.businessinsider.com/c/510fca5269beddb47c000008mike77Mon, 04 Feb 2013 09:48:50 -0500http://www.businessinsider.com/c/510fca5269beddb47c000008
i could care less what they charge, but carried interest is a joke that should be abolished. And by the way, they are in the business of making money, not helping companies get started.http://www.businessinsider.com/c/510fc8a4eab8ea232300000buummmMon, 04 Feb 2013 09:41:40 -0500http://www.businessinsider.com/c/510fc8a4eab8ea232300000b
They should pay very high taxes like 75%+. If you are an investing class leech, pay up now!http://www.businessinsider.com/c/510fc84eecad04954c000014Aqua BuddhaMon, 04 Feb 2013 09:40:14 -0500http://www.businessinsider.com/c/510fc84eecad04954c000014
Those scoundrels are very dangerous too!http://www.businessinsider.com/c/510fc7e06bb3f7723e00000bNickMon, 04 Feb 2013 09:38:24 -0500http://www.businessinsider.com/c/510fc7e06bb3f7723e00000b
2 and 20 is a racket? Then don't invest in funds charging 2 and 20.
That said, fund managers have the right and freedom to charge whatever they want so long as people are willing to pay it and REST ASSURED there are plenty of people willing to pay it.
It's not society's place to say if they make too much money. As long as people are willing to pay for their services it is between the manager and the client and is ABSOLUTELY nobody else's business.
That said Obama is clever going after this. Not many people fully understand the alternative investment space and thus have no frame of reference for WHY the taxes are the way they are in this instance. Plain and simple.........if you make investing less lucrative, less people will invest. The cost of capital will rise dramatically and starting a new company will get MUCH more difficult. Look at the VC's in california, they just got hit with a huge retroactive "exit tax" and now you are gonna hit their incentive fees? THESE PEOPLE ARE IN THE BUSINESS OF HELPING COMPANIES GET STARTED WHY ARE YOU PUNISHING THEM?!?!http://www.businessinsider.com/c/510fc6bd6bb3f7133a00000dchrisl v2.0Mon, 04 Feb 2013 09:33:33 -0500http://www.businessinsider.com/c/510fc6bd6bb3f7133a00000d
I wonder if Obama realizes he's going to cross swords with Chuck Rangel(D-somewhere in NYC), he's the one responsible for the loophole. Sorry Linnette didn't mean to disrupt your narrative.http://www.businessinsider.com/c/510fc65969bedde173000007thinkaboutitMon, 04 Feb 2013 09:31:53 -0500http://www.businessinsider.com/c/510fc65969bedde173000007
Why should any one have a special tax situation. Pay as you go at the established rate. The same ones that want this deal are the same ones complaining about social programs. They don't want to pay their own way but the expect everyone else too. We need serious tax reform in this country. You make X you pay this percentage regardless of where it came from with no deduction. The rate would be lower for everyone as a whole. Time to stop the game playing.http://www.businessinsider.com/c/510fc53ceab8ea1a1d00000cblack swanMon, 04 Feb 2013 09:27:08 -0500http://www.businessinsider.com/c/510fc53ceab8ea1a1d00000c
What a total joke. Judge Obama by his actions and his appointees, and not by his words. This 15 minute Bill Moyers video will tell you everything you want to know about who in in charge of the Obama Administration:
<a href="http://www.smirkingchimp.com/thread/bill-moyers/47891/video-matt-taibbi-on-big-banks-lack-of-accountability" target="_blank" rel="nofollow" >http://www.smirkingchimp.com/thread/bill-moyers/47891/video-matt-taibbi-on-big-banks-lack-of-accountability</a>http://www.businessinsider.com/c/510fc4cc6bb3f7cd3500000cBeltway GregMon, 04 Feb 2013 09:25:16 -0500http://www.businessinsider.com/c/510fc4cc6bb3f7cd3500000c
The last refuge of scoundrels. There goes the profit margins. 2 and 20. What a racket.